2018 Tax and Wage Issues for Household Employers

2018 tax and wage issues for household employersWith a new year just around the corner, there are several tax and wage issues that will impact household employers, particularly those in New York, including changes to the minimum wage and mileage reimbursement rates.

Minimum Wage
On December 31, 2017, the minimum wage for employers in Upstate New York will rise to $10.40 per hour.

The wage for employers in New York City with 10 or fewer employees must pay $12.00 per hour. Employers in Nassau, Suffolk, and Westchester Counties must pay at least $11.00 per hour.

Mileage Rate
If you reimburse your nanny or other domestic worker for mileage, the standard mileage rates for the use of a car (plus vans, pickups, and panel trucks) are increasing, effective January 1, 2018. The new rates will be:

  • 54.5 cents per mile for business miles driven (was 53.5 cents in 2017)
  • 18 cents per mile driven for medical or moving purposes (was 17 cents in 2017)
  • 14 cents per mile driven in service of charitable organizations (no change from 2017)

New York Paid Family Leave
Beginning January 1, 2018, just about every employer in New York State – including household employers – will need to comply with the New York Paid Family Leave (NY PFL) law. Any employer that has 1 or more employees is required to provide coverage unless they are a public employer or are an employer-only exempt employee.

Employees can use the benefit to:

  • Bond with a newborn, adopted or foster-care child during the first 12 months after birth or placement
  • Care for a seriously ill family member
  • Address important needs related to a family member’s military service

Learn more about what employers and nannies need to know about NY PFL.

What Nannies Need to Know About New York Paid Family Leave

nannies new york paid family leaveWe posted an article about how the upcoming New York Paid Family Leave (PFL) law will affect household employers, but nannies and other household employees may have many questions about how they can use this new benefit. ShelterPoint has put together this handy list of things nannies should know about using New York Paid Family Leave.

  1. For foreseeable events (such as birth or scheduled treatments/therapy), you should provide your employer with a 30-day notice of intent before using PFL benefits. If you are not able to provide this notice due to the sudden nature of the qualifying event (such as a family member’s stroke, emergency delivery, or short-notice deployment), you are still entitled to the leave but have to notify the employer as soon as reasonably practicable (typically within 2 days).
  2. If you take intermittent leave, your employer has the right to require you to provide notice before each day of leave – even if it is a regular schedule.
  3. There is no “waiting period.”
  4. Once on leave, you will receive a monetary PFL benefit (partial income replacement) from your employer’s DBL/PFL insurance carrier.
  5. You can’t take DBL and PFL at the same time, i.e, receive benefits for both concurrently. They have to be taken in sequence. And if you qualify for both DBL and PFL, the combined duration cannot exceed 26 weeks in a consecutive 52-week period (whether using those benefits for the same or different qualifying event).
  6. Your employer cannot require you to use up any accumulated paid time off (such as sick/vacation days) before letting you go out on paid family leave.
  7. You have, however, the option to use any vacation days during your Paid Family Leave, thereby receiving your full salary as opposed to the percentage provided for by PFL. However, if you do this:
    • You will not be able to collect both paid time off (such as vacation pay) and monetary Paid Family Leave benefits simultaneously.
    • In this case, PFL provides only the job protection aspect.
  8. Paid Family Leave provides more than just a monetary benefit – it provides job security similar to unpaid leave under FMLA, but regardless of the size of the employer.
    • When returning from PFL, you are entitled to return to your same or comparable position
    • If your employer declines to reinstate you when returning from PFL, you have the right to report this to NY State
  9. If you have health insurance through your employer, it’s continued at your usual coverage level and contribution amount as if you weren’t on leave.

Source: http://pfl.shelterpoint.com/for-employees

Contact us at (518) 348-0400 for more information.

New York Paid Family Leave and Household Employers

new york paid family leaveNew York State employers — including household employers — will be required to provide paid family leave to their employees beginning January 1, 2018. Our friends at GTM Payroll Services have put together this handy guide to ensure you are compliant with the new law and that your nanny knows how to use this benefit.

What is NYS Paid Family Leave (PFL)?

Passed in 2016, NYS PFL extends beyond the federal Family and Medical Leave Act (FMLA), providing employees paid leave for various family or medical reasons. PFL can be taken by male or female employees to:

  • Bond with a newborn, adopted or foster-care child during the first 12 months after birth or placement
  • Care for a seriously ill family member
  • Address important needs related to a family member’s military service

Your employee may receive wage compensation of up to eight weeks for PFL in 2018 with a maximum weekly benefit of 50 percent of their average weekly wage or the average New York State weekly wage of $1,305.92, whichever is less.

Full-time employees are eligible after 26 consecutive weeks of employment. Part-time workers can take advantage of PFL after 175 working days. They can expect to maintain their same or similar job upon their return to work.

Is my household employee covered by this new law?

Yes, household employees who work 40 or more hours a week and 30 days in a calendar year are required to be covered with both disability insurance and PFL. If your employee does not work at least 40 hours, you may set up a voluntary PFL policy or you may add PFL to your existing voluntary disability policy.

Who pays for NYS PFL?

The program is paid for by employees through an additional payroll deduction that can begin on July 1, 2017. New York State dictates the rate of this deduction and can change it each year. For now, the rate will be .126% of the first $1,305.92 earned each week (max. deduction of $1.65 per week).

While on paid family leave, employees are compensated through the program and not by their employer.

Who is the premium paid to?

Your disability insurance carrier will also be your carrier for PFL. The PFL premium will be paid when your disability premium is due.

Can I set this up if my employee does not work 40 or more hours per week?

You can purchase a voluntary PFL policy or you may add PFL to your existing voluntary disability policy. You can request a quote through our insurance department.

My employee works 40+ hours per week and I want her to be eligible for PFL but I do not have a disability policy set up. What should I do?

Household employers in New York State are required to have a disability policy when an employee works 40 or more hours per week. You can request a quote through our insurance department.

I have a disability policy and want my employee covered for PFL. Can I pay this for her instead of deducting it from her pay?

Yes. If you do not deduct the amount from your employee’s paycheck, then you will pay the cost on your employee’s behalf. You should contact your disability insurance policy administrator to find out how you would make a payment for the PFL policy.

Am I required to deduct the NYS PFL from my employee?

Technically, you are not. However, you will still need to pay the premium to your insurance carrier. If you do not deduct the amount from your employee’s pay, then you will pay the cost on your employee’s behalf. If you would prefer this method, please let us know as soon as possible so we can stop the deduction from your employee’s pay.

Source: https://gtm.com/household/new-york-paid-family-leave-household-employers/

 

For more information, contact us at (518) 348-0400.